European Court Classifies Uber as a Transportation Service

Subject to the same regulations as other transportation services

Uber may make getting around without a car convenient and relatively affordable, but it's also upset traditional taxi drivers. A professional taxi driver's association in Spain recently took Uber to court, accusing the ride-hailing service of misleading practices and creating unfair competition. On Wednesday, the European Court of Justice ruled against Uber.

Bloomberg reports that the European Union has decided that Uber should be classified as a transportation service, meaning it will be subject to the same rules and regulations that apply to taxi services. Uber argued that it's little more than an app that connects people looking for a ride with drivers willing to offer them a ride, but the court disagreed. As a result, Uber will not be classified as an online service like it had hoped.

"The service provided by Uber connecting individuals with non-professional drivers is covered by services in the field of transport," the European Court of Justice said. "Member states can, therefore, regulate the conditions for providing that service."

The ECJ also said that Uber "exercises decisive influence over the conditions under which the drivers provide their service" and that without the app, "persons who wish to make an urban journey would not use the services provided by those drivers."

In many European countries, Uber is already considered a transportation service and follows local transportation rules. But now that the EU has made its position clear, it will be more difficult for Uber to claim it's nothing more than an app. It could also impact Uber's ability to expand into new markets.

"This ruling will not change things in most EU countries where we already operate under transportation law," Uber said in a statement. "As our new CEO has said, it is appropriate to regulate services such as Uber and so we will continue the dialogue with cities across Europe."